K562 human erythroleukemia cells constitutively express epsilon- and gamma- but not beta-globin genes. We have previously shown that the differential expression of globin genes observed in intact K562 cells could be simulated in vitro as K562 nuclear extract (NE) actively transcribes the epsilon- globin (with 2 kb of 5' flanking sequence) and gamma-globin gene DNA templates but not beta-globin gene templates. We have now used the K562 in vitro transcription system to examine a silencer transcriptional control element which has been reported to be localized between -177 and -392 bp 5' of the canonical cap site for the epsilon-globin gene. We find that K562 NE has markedly reduced synthesis of RNA in vitro from epsilon-globin gene DNA deletion templates which contain the silencer sequence, or part thereof, but not the adjacent 5' positive regulatory region (-453 to -535 bp). Furthermore, those transcripts generated in vitro from DNA templates extending to -453 bp or less of the epsilon-globin gene were not correctly initiated at the canonical cap site. Separating the K562 NE by ion exchange chromatography, we isolated a fraction (F175) transcriptionally active for all tested globin genes including the epsilon-globin gene containing the silencer sequence and a fraction (F50) which contains the trans-acting factors associated with the silencer activity. F50 showed a strong dose dependent inhibitory effect on correctly initiated epsilon- globin gene transcription directed by either unfractionated K562 NE or F175. This suppression by F50 was not observed on transcriptional activity of the permissive adenovirus 2 major late promoter. In electrophoretic mobility shift assays using the epsilon-globin gene silencer region as probe, F50 and F175 exhibited different DNA binding protein patterns: a specific protein band in F50 appears to be associated with the silencer activity. These studies suggest that this protein may be specifically responsible for the activity of the silencer element of the epsilon-globin gene. The expression and silencing of the epsilon-globin gene during development may be modulated by the interactions of this protein with the cis-acting DNA silencer.